News

Run nearly broke Royal Bank of Scotland

A SECRET run on Royal Bank of Scotland almost forced the bank into collapse on each of the last four trading days before it was bailed out by the government last October, The Sunday Times can reveal.

Between £1 billion and £2 billion was being sucked from RBS every day for more than a week, according to sources involved in the bailout. This created an even bigger funding problem for the bank, which was already struggling to finance overnight credit lines in global money markets.

RBS would have collapsed much earlier were it not for signficant levels of support from the Bank of England and the US Federal Reserve, the insiders have revealed.

RBS's deposit base was being hit on several fronts. The Irish government's decision to guarantee deposits at its domestic banks forced a savage run on RBS-owned Ulster Bank - which was not covered by the agreement.